Americans’ real incomes have fallen for the third year in a row due to high inflation and energy prices caused by the conflict in Ukraine. This was reported by Wall StreetJournal Based on data from the US Census Bureau.
According to the report, median U.S. household income fell 2.3 percent in real terms last year to $74,580; This represents a three-year decline in real income of 4.7 percent from the peak in 2019.
Comerica Bank Chief Economist Bill Adams states that high inflation rates in 2022 will hit family budgets and reduce purchasing power. However, the situation is improving this year as inflation slows down and wages increase. “The outlook is better for wages to offset some of the losses in recent years,” Adams said.
The typical U.S. worker’s real wage has been rising since last December. There was an increase of 3 percent in July compared to the same period of 2022. This supports consumer spending and economic growth despite the Fed’s rate hikes.
Inflation in the US slowed from 9.1% in June 2022 to 3.2% in July as the Federal Reserve’s interest rate hike reached a 22-year high. The median income of white households fell 3.6% in 2022, while the income of Black, Asian and Hispanic households remained roughly the same as the previous year, according to the report.
The official poverty rate in the United States in 2022 was 11.5%, or approximately 38 million people. According to an alternative method of accounting for social benefits and taxes, the share of the poor increased to 12.4%.
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